Overview
Abu Dhabi Global Market is an international financial centre located on Al Maryah Island in Abu Dhabi. Established by Federal Decree in 2013, ADGM operates as a financial free zone with its own civil and commercial legal framework based on English common law — a jurisdiction entirely separate from the UAE’s federal legal system and Abu Dhabi’s local courts. More than 1,800 entities are registered within ADGM, spanning financial services, professional services, technology, and holding structures.
ADGM represents Abu Dhabi’s most significant institutional commitment to building a globally competitive financial services sector — one of the twelve target sectors identified in the Economic Vision 2030.
Legal Framework
ADGM’s defining characteristic is its legal infrastructure. The financial centre operates under its own body of civil and commercial laws, directly enacted by the ADGM Board of Directors. These laws are based on English common law, providing a legal framework familiar to international financial institutions, investors, and professional services firms.
This is not a superficial adoption. ADGM’s courts apply English common law principles, and its regulations are modelled on international best practice standards, including those of the United Kingdom’s Financial Conduct Authority and Prudential Regulation Authority. The result is a jurisdiction within Abu Dhabi that offers the legal certainty, contract enforcement, and regulatory familiarity that global financial services participants require.
The legal separation extends to employment law, company law, insolvency law, and data protection regulation within the ADGM free zone. Entities registered in ADGM operate under an entirely different legal regime from those registered under Abu Dhabi mainland or other UAE free zone jurisdictions.
Three Authorities
ADGM’s governance is structured around three independent authorities, each responsible for a distinct function.
Registration Authority
The Registration Authority manages entity registration, licensing, and corporate governance within ADGM. It oversees the establishment and ongoing compliance of all registered entities, including companies, partnerships, foundations, special purpose vehicles, and branches of foreign companies.
The Registration Authority sets the requirements for entity formation, minimum capitalisation (where applicable), beneficial ownership disclosure, and annual filing obligations. Its framework supports a range of entity types designed to serve international financial and commercial activities.
Financial Services Regulatory Authority (FSRA)
The FSRA is the independent financial services regulator within ADGM. It authorises and supervises all regulated financial activities conducted within the financial centre, including banking, asset management, insurance, securities trading, and financial advisory services.
The FSRA operates under a regulatory framework that draws on international standards, including those of the International Organization of Securities Commissions (IOSCO) and the Basel Committee on Banking Supervision. Its risk-based approach to supervision is designed to maintain financial stability and market integrity while enabling innovation.
The FSRA has established dedicated regulatory frameworks for specific activities, including a fintech regulatory sandbox, digital asset regulation, and sustainable finance guidelines. The fintech sandbox has been particularly significant, providing a pathway for early-stage financial technology companies to test products and services under regulatory oversight before obtaining full authorisation.
ADGM Courts
The ADGM Courts form an independent judicial system with jurisdiction over civil and commercial disputes arising within the financial centre. The courts are staffed by judges drawn from leading common law jurisdictions, including the United Kingdom, Australia, and Singapore.
The court structure includes a Court of First Instance and a Court of Appeal. Proceedings are conducted in English. The courts apply ADGM’s own body of law, supplemented by English common law principles where ADGM legislation does not address a specific matter.
The ADGM Arbitration Centre provides alternative dispute resolution services, offering administered arbitration under ADGM Arbitration Regulations. This infrastructure is critical for international financial transactions where parties require enforceable dispute resolution mechanisms.
Entity Types
ADGM accommodates a range of entity structures designed for different commercial and financial purposes:
Special Purpose Vehicles (SPVs) are widely used for structured finance transactions, asset holding, and investment structuring. ADGM’s SPV framework provides efficient formation and clear governance requirements.
Holding Companies benefit from ADGM’s common law framework, zero corporate tax (subject to OECD Pillar Two global minimum tax developments), and absence of foreign exchange controls.
Fund Managers and Funds operate under a comprehensive regulatory framework that accommodates both conventional and Islamic fund structures. ADGM has attracted fund managers from across the GCC, Asia, and Europe.
Fintech Companies benefit from the FSRA’s regulatory sandbox and dedicated digital asset framework. ADGM was among the first jurisdictions in the MENA region to establish a comprehensive regulatory framework for virtual assets and digital securities.
Professional Services Firms including law firms, accounting practices, and consultancies register in ADGM to serve the financial centre’s growing client base and the broader Abu Dhabi market.
Comparison with DIFC
The Dubai International Financial Centre, established in 2004, is ADGM’s most direct competitor. Both are English common law financial free zones within the UAE. The comparison is relevant because financial institutions and investors frequently evaluate both jurisdictions when establishing a presence in the country.
DIFC has a decade-long head start and a substantially larger base of registered entities. Its ecosystem is more mature in areas such as private banking, insurance, and legal services. Dubai’s position as the broader commercial hub of the UAE gives DIFC a structural advantage in attracting firms that prioritise proximity to the largest number of corporate clients.
ADGM differentiates through regulatory innovation, particularly in digital assets and fintech. Its younger establishment means its legal and regulatory frameworks were designed from inception for contemporary financial services activities, without the legacy constraints of an older jurisdiction. ADGM has also positioned itself as the preferred jurisdiction for entities with a primary relationship to Abu Dhabi’s sovereign wealth funds and government-related entities.
The two financial centres are not strictly competitive — many firms maintain registrations in both. But the jurisdictional choice reflects strategic orientation: firms focused on Abu Dhabi’s sovereign capital ecosystem gravitate toward ADGM, while those serving Dubai’s broader commercial market typically anchor in DIFC.
Role in Abu Dhabi Economic Vision 2030
The Economic Vision 2030 identifies financial services as one of twelve target sectors for diversification. ADGM is the primary institutional mechanism for achieving this objective. By creating a world-class financial centre with international legal standards, Abu Dhabi has established the infrastructure necessary to attract global banks, asset managers, insurance companies, and financial technology firms.
ADGM supports multiple vision objectives simultaneously. It advances the regulatory reform agenda under Pillar Three (Optimal Transparent Regulatory Environment) by demonstrating that Abu Dhabi can create and maintain a regulatory framework meeting the highest international standards. It supports Pillar Four (Strong Diverse International Relationships) by providing a platform that integrates Abu Dhabi into global financial networks. And it contributes to Pillar One (Large Empowered Private Sector) by providing the commercial infrastructure for private sector financial services activity.
Institutional Significance
ADGM’s creation represents a fundamental statement of ambition. By establishing its own common law jurisdiction, Abu Dhabi has signalled that it intends to compete not merely as a regional financial centre but as a globally credible one. The quality of its courts, the sophistication of its regulatory framework, and the pace of its innovation in areas like digital assets and sustainable finance position ADGM as an institution whose significance extends well beyond the number of entities registered within it.